Connecting European Consumers and Small Scale Farmers in Vietnam Through a Cost-sharing Model
Approximately 80% of export volume of Vietnamese shrimp originates from small-scale shrimp farms in the Mekong Delta. This area is under significant threat from negative environmental impacts such as pollution, natural resource loss, mangrove forest loss, etc. As a solution, WWF-Vietnam has recently signed a project agreement with a Vietnamese seafood company and an international seafood buyer with the objective of supporting small-scale shrimp farming households in Soc Trang province in adopting sustainable shrimp production practices.
The agreement commits TAIKA Seafood Corporation and Northcoast Seafood DK to take on a significant share of the costs associated with obtaining and sustaining ASC certification for 40 shrimp farming households in two cooperatives, for a three-year period. Small-scale shrimp farms, which normally have an area of 1.5-2.5 ha, face difficulties meeting the high costs and technical requirements to becoming ASC certified.
“Previously, we have simply raised shrimp in our own way. Neither standards applied nor environmental or social impacts aware. Joining this agreement has resulted in several improvements for our farmer group. For example, we have been trained and now have knowledge on shrimp health management; we do not discharge wastewater into the surrounding environment; the shrimp prices are steadier and higher, and we are less prone to price squeezes by the dealers. Moreover, our shrimps have a better quality now as we do not apply antibiotics”, said a farmer of Thuan Thanh cooperative - Au Thanh Hung.
Over the next three years, Mr. Hung and other members of the two shrimp farming cooperatives, Nong Ngu 14/10 and Thuan Thanh, have committed to produce 300 MT of ASC certified shrimp per year for TAIKA Seafood Corporation, who signed the exporting agreement with Northcoast Seafood DK. These 40 shrimp farms cover a total area of about 55 ha.
This type of cost-sharing model linking small-scale farmers, to processors and international buyers is brand new in Vietnam’s shrimp industry. The model strengthens the incentive of small-scale producers to adopt sustainable production and ensures a market as the processing companies and international buyers are highly committed to source sustainable and traceable shrimp products.
“Shrimp, mostly produced by small-scale households, has a global supply chain. The collaboration between an international importer (Northcoast Seafood DK), a Vietnamese processor (TAIKA Seafood Corp.), the farmer groups and the WWF is in practice of public-private partnership to help small-scale shrimp farmers adopting sustainable production practices. With this mechanism, the private sector are invited to take a more active role in promoting sustainable production and consumption”, stated Mr. Huynh Quoc Tinh, Program Coordinator - Aquaculture and Food Practices of WWF-Vietnam.
WWF-Vietnam looks forward to the participation and cooperation of the relevant stakeholders, especially from the private sector, to replicate this type of cost-sharing model for smallholder certification. The model is also an important step for improving the livelihoods of small-scale shrimp households and promote sustainable development in the Mekong delta of Vietnam.
“For Northcoast Seafoods DK, it is also a matter of safeguarding our own business in the long term. Therefore, we are now taking a step ahead from sourcing responsible produced products to actively taking responsibility of the green transition of the shrimp production among the many small-scale producers in Vietnam. By sharing the costs associated with the ASC certification across the entire value chain, we can enable certification of the small-scale producers to the benefit of them, the environment and of the sustainability of our own business – a so-called win-win-win.” - CEO from Northcoast Seafoods DK - Nicolai Møller Karlshøj
Up-coming activities of the project ‘Promoting of certification and better management practices for small-scale shrimp farming in Vietnam’:
Providing farmers market information, production management training, and product consumption linkage.
Establishing and monitoring a purchasing system for ASC certified shrimp from the small-scale shrimp farms who signed the contract with processors and importers.
Continuously establishing and multiplying the practices of public-private partnership: cost-sharing agreement and farming contract between stakeholders in the shrimp supply chain.
Implementing communication activities to share information and connect the stakeholders in the supply chain.
Promoting the consumption of sustainable aquaculture products.